Seawall project bonding in doubt

Whether or not a new Lakefront Boulevard seawall will be built this year, or anytime soon, is unclear after a Monday evening meeting of the Dunkirk Common Council Finance Committee. The project would be paid for in part with a $4.2 million bond that council will consider at its meeting today at 5:30 p.m. in City Hall.

Four votes are needed to approve any bonding and it was unclear if Mayor Anthony J. Dolce and city officials who support the project can find those votes.

As proposed, the project will reconstruct nearly 2,800 linear feet of the existing seawall, replacing it with a precast concrete modular wall. In addition, the construction of a bicycle path and pedestrian facility along the wall, the replacement of the existing pipe railing, the construction of an American with Disabilities Act compliant ramp for beach access, and all preliminary work and necessary equipment, materials and site work and any preliminary costs and costs incidental thereto and in connection with the financing of the project are part of the project.

Serial bonds would be issued, with any federal, state, county and/or local funds received offsetting the final cost to the city. The property taxpayers would pay for 75 percent of the cost through Fund I, the general fund. the remaining 25 percent would be paid through Fund III, the wastewater treatment fund.

City Treasurer Mark Woods presented three payment plans for the $3.5 million the city would look to borrow. The remainder would be paid for through existing grants, which may not be available if the project does not go forward at this time. Woods used recent interest rates to make his calculations.

Borrowing for 10 years would result in a $1.10 per thousand dollars of property valuation increase in property taxes. The wastewater fund would see a $5.10 per quarter for the average user. A 15-year repayment would put those numbers at 81 cents per thousand and $3.75 per quarter sewer rate increase; the 20-year figures are 67 cents per thousand and $3.15 per quarter ewer rate increase.

The interest paid would drop depending on the length of the repayment, the longer period the more interest is paid. Using Woods’ figures, the 10-year interest would total $607,543; 15-year interest would total $1,020,018; 20-year interest would total $1,511,537.

Dolce, Development Director Steve Neratko and Department of Public Works Engineer Randy Woodbury all spoke of the need for the project. Delaying the project and starting over later could be costly as well, as permits and engineering studies would likely have to be redone, Dolce pointed out.

Talk turned to possible tax cap issues, with Woods saying the city would likely have to do an override of the 2 percent tax cap law whatever the length of the repayment plan.

“It’s based not on the rate per thousand but on the dollar amount of revenue if you increase … the collection of taxes,” he explained. “We would definitely have to override the tax cap.”

Councilwoman-at-Large Stephanie Kiyak asked if the residents would have a say in an override but was told that was a council decision. Dolce talked about possible budget cuts but Kiyak wanted to know what lines could be cut, saying the (2015) budget was “just around the corner.”

“If you don’t have an idea now how can you know in a couple more months?” she asked. “You knew I was going to ask specifically what lines, I gave you a heads-up more than two weeks ago. It’s either this plan or I can’t really trust that there’s this other nebulous plan out there.”

Dolce said she didn’t have to trust it but reminded her that the 2014 budget did cut some budget lines. Woods said the bond was what was needed to repay the principal and interest on the project.

The issue seemed to boil down to pay a lot now, or pay more later.

“Waiting will lead to a higher cost. Do we leave this mess for the next administration and start this whole process over again?” Councilwoman Stacy Szukala asked. “I don’t feel comfortable doing that. … If it’s not our wall to take care of, who’s going to take care of it?”

Kiyak claimed just a small portion of the wall was deteriorating.

“I don’t know if it’s the right thing to hit everyone up with a huge tax increase for something like that when we’ve got other imminent issues right now on our plate,” she stated. “It still concerns me what HUD’s going to come back with and where we’re going to get that money. … I think there’s other important things on our plate that we still don’t have a firm grasp of how we’re going to deal with that.”

Gonzalez said that although the need to fix the wall was there he didn’t feel comfortable raising taxes to pay for the work.

“It is a city issue, it needs to be done, but to raise the taxes $40 or $50, should we do the wall?” he asked.

Szukala said the problem won’t go away, will only get worse and she will support the bonding.

Kiyak countered that the wall was not a necessity like water lines and road repairs and indicated she would not support the bonding.

Councilman Michael Michalski said the wall needs the work and indicated he would support the bonding resolution. Councilman William J. Rivera said he was leaning toward supporting the bonding while Gonzalez said he had not made up his mind yet.

After the meeting, Dolce said he was hopeful the resolution would receive the four votes.